Gambling industry probe urged - Tuesday 12th of July 2005

A new Law Commission of Canada report calls for a federal inquiry into the nations $13-billion gambling industry, while questioning the legality of Ontarios casinos and on-line gambling operations on Native reserves in Quebec.

The commission is an independent federal agency that advises Parliament on emerging legal issues.

The paper entitled The Legalization of Gambling in Canada argues that since 1969, when gambling laws were relaxed in the country, the publics perception of gambling has changed "from a sin, to a vice, to a mode of entertainment."

However, with this rapid expansion over the past three decades, gambling policy has frequently been made without public input and on an ad hoc basis, the report argues.

"Of all the Western democracies that have seen major expansion in gambling, we are the only country that hasnt embarked on a national review," said Colin Campbell, the lead author of the report.

Provincial self-regulation of the industry has led to a lack of transparency and accountability; the monopolization of the industry by certain private firms; a lack of uniform laws across the country, and a failure to consider the long-term impact on public welfare of such consequences as problem gambling, the report argues

Mr. Campbell said that as the owner, operator, regulator, and beneficiary, the provinces are in an inherent conflict of interest position when it comes to the gambling industry.

"A Canadian national gambling inquiry is long overdue," the report states.

While comparing gambling policy in Canada with those of the U.S., the U.K. and Australia, the report also explores the proliferation of VLTs and on-line gambling and direct and indirect crimes associated with the industry, from theft and fraud to racketeering and bookmaking.

Mr. Campbell, who is an instructor of criminology at Douglas College in Vancouver, admits most studies do not point to an increase in crime rates in the jurisdictions around gambling establishments.

The report does, however, explore some of the grey areas that have formed in the gambling industry like the legality of 30 internet gambling sites that have been operated on Kahnawake Mohawk reserves in Quebec since the late 1990s.

Under the Criminal Code, provincial governments are the only ones that can operate on-line casinos, but the Kahnawake Mohawks, who consider themselves an independent state, have established the Kahnawake Gaming Commission to license and regulate the sites on Internet servers physically located on their tribal lands, the report says.

"The question is whether the Kahnawake are a provincial government," Mr. Campbell said.

While the Kahnawake Mohawks are allegedly violating the Criminal Code, and while the Quebec and federal governments, together with the provincial police have investigated their Internet gambling activities, no action has been taken to halt the operations.

The question of who is operating casinos in Ontario arises in the report. Mr. Campbell argues that by letting American companies manage its casinos, The Ontario government may be violating the Criminal Code.

Another issue that has arisen, Mr. Campbell said, is in the VLT industry.

Computer subprograms, or Easter eggs, have been found in VLTs in Canada, he said.

Easter eggs can be triggered by computer savvy players, and allow them to continue to play VLT games after their credit runs out - essentially allowing them to win without paying.

Mr. Campbell would not say which province or what casino the Easter eggs were found in, but he said there is a case currently going on in Canada where someone who brought forward accusations of an egg was sued for slander by one of the multimillion-dollar casino operating firms.

All these issues point to the need for federal regulation of the industry, he said, but likely wont cause one because of the "hornets nest of resistance from the provinces" it would likely illicit.

Rae Raymond, spokesman for the Law Commission, said the paper is part of a larger project, tentatively titled, What is a Crime, which explores the issue of what constitutes a crime in modern Canada, what is acceptable, and what is not.

The Law Commission is doing five other case studies like the one on gambling, exploring aboriginal harvesting, welfare fraud, social housing in Montreal, and access to information.

The case studies will be published in mid-August and be presented to Parliament in the Spring of 2006 with the Law Commissions recommendations on how to regulate problem areas.

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